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TMI Blog2014 (10) TMI 828X X X X Extracts X X X X X X X X Extracts X X X X ..... law. However, in this case, as is seen, CIT(A) has not exercised any power for withdrawal of the approval already granted under section 80G(5) of the Income-tax Act in the case of the assessee and merely on the application of the assessee for renewal of exemption under section 80G passed the impugned order. This reason itself is sufficient to set aside and quash the impugned order. - Decided in favour of assessee. - ITA No. 1013/CHD/2011 - - - Dated:- 17-10-2014 - SHRI BHAVNESH SAINI AND SHRI T.R.SOOD, JJ. For the Appellant : Shri Sudhir Sehgal For the Respondent : Smt. Jyoti Kumari ORDER Bhavnesh Saini (Judicial Member).- This appeal by the assessee is directed against the order of the learned Commissioner of Income-tax-I, Ludhiana, dated August 24, 2011 rejecting the application for renewal of exemption under section 80G of the Income-tax Act, 1961 on the following grounds : 1. That the learned Commissioner of Income-tax-I, Ludhiana has erred in rejecting the application of the appellant-trust for the grant of renewal of exemption under section 80G of the Income-tax Act, 1961 by not considering the fact that the trust was registered and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . How the foreign income is exempt ? The assessee filed reply to the same. It is not in dispute that earlier registration under section 12AA has been granted to the assessee along with approval under section 80G of the Income-tax Act. The learned Commissioner of Income-tax, however was not satisfied with the explanation of the assessee that the assessee was registered with the Registrar of Societies as well as with Registrar of Trust and that there is a change in the trustees by the supplementary deed. The learned Commissioner of Income-tax also scrutinized the accounts of the assessee for the year ending March 31, 2008, March 31, 2009 and March 31, 2010 and found that capital expenditure is more than 80 per cent. The learned Commissioner of Income-tax, considering the issue in detail concluded in paragraph 20 of the impugned order that property of the trust is not applied to the extent of 85 per cent. to the stated object and that there is a unilateral change by amendment of the trust on July 9, 1999 when the trust property included mainly fixed assets and that this entity was created for vested interest of a few promoters. It was, therefore, found that the assessee-society did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal following its earlier decision and the Central Board of Direct Taxes circular held that the approval under section 80G(5) of the Act already granted to the assessee shall continue unless and until the concern authority takes appropriate action in accordance with law. He has submitted that the said decision is confirmed by the hon'ble Punjab and Haryana High Court in the case of CIT v. Bhhola Bhandari Charitable Trust in I. T. A. 238/2012 dated January 30, 2013 [2013] 351 ITR 469 (P H) in which it was held that once the statute has given perpetuity to the exemptions granted under section 80G(5) of the Act, the same cannot be withdrawn without issuing show-cause notice in terms of the statutory provisions in the manner prescribed by law. He has, therefore, submitted that the learned Commissioner of Income-tax should not have withdrawn the exemption granted to the assessee and should have continued with the same. 4. On the other hand, the learned Departmental representative relied upon impugned order and submitted that section 293C of the Act provides power to withdraw the approval which is general in nature and as such the learned Commissioner of Income-tax correctly w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent under section 80G(5) of the Income- tax Act. Further, the learned Commissioner of Income-tax noted that there is a change in the trustees, such is also not a reason to disbelieve the explanation of the assessee. The learned Commissioner of Income-tax also scrutinised the accounts of the assessee for the year ending on March, 2008, 2009 and 2010 and held that the capital expenditure is more than 80 per cent. Such reasons were not relevant for rejecting the application for renewal of the exemption because for those assessment years, the assessee had already been granted approval under section 80G(5) of the Act. The change in the trustees pertain to the time the registration under section 12AA and approval under section 80G were granted to the assessee. Further, the assessee had received foreign donation with the approval of the Government as explained (copies filed). Therefore, there is no income in the nature of foreign income. The trust deed was amended by adding supplementary trust deed which was done as per requirement issued by the Revenue Department at the time of grant of registration under section12AA of the Act and would not change the aims and objects of the assessee-tr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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